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Local vs. Hosted CRM Solutions

Customer relationship management—better known by its acronym, CRM—has become an integral part of today’s enterprises. The solutions not only enhance company-client correlation but also provide better return on investment (ROI).

There are multiple vendors offering CRM solutions. However, since many companies are not well-versed with the CRM technology, they find it convoluted and difficult to decide on the right solution.

Often companies are not sure whether to go for on-premise or hosted CRM solutions. A little understanding of these two different solutions helps in taking the right decision.

Traditionally, medium-sized businesses deployed the on-premise option in their one major office with an IT team. With on-premise CRM, businesses can provide multiple departments with access to customer data and also coordinate work functions such as sales, marketing, customer service, and more.

These days, hosted solutions are fast becoming the preferred CRM technology. Hosted CRM solutions are considered to be ideal for multi-office businesses. They eliminate network maintenance troubles and also expense of on-premises hardware and software.

Although it eliminates hardware and software investment cost, industry experts say that this not a guarantee of a “better value.” In comparison, on-premise solutions are likely to start pay off their costs in three years.

However, on-premise solutions demand considerable technical support resources and also require internal IT support, which add to the investment cost. Also, a full deployment can take up to four months. Whereas, hosted solution become active almost immediately and is fully supported by the provider.

On-premises CRM solutions offer a range of functionality and system architecture, which are customized according to a company’s needs and internal processes. These advanced options are more useful for larger companies compared to smaller ones.

Hosted solutions offer access to data with any live Internet connection, while on-premise CRM solutions keep this data on a LAN or WAN.